5 ms·

There are clever ways of addressing gaming, for example, to counter undervaluation there could be a rule that says that if you value your land at $X then anyone

by tome 5y ago

There are clever ways of addressing gaming, for example, to counter undervaluation there could be a rule that says that if you value your land at $X then anyone is legally allowed to force you to sell it to them for $X. This works both ways. If the government overvalues your land at $X then you can force them to purchase it from you for that much, for example.

lelanthran 5y ago
> There are clever ways of addressing gaming, for example, to counter undervaluation there could be a rule that says that if you value your land at $X then anyone is legally allowed to force you to sell it to them for $X. That doesn't work. Just because I inherited my fathers beloved VW Beetle[1] that's only worth $1000 doesn't mean that I want to part with my father's beloved VW Beetle; it means much more to me than the official valuation. Same goes for any other property - boats, land, etc. [1] Example only, I did not
- tome 5y ago
  I don't understand the objection. If it's only worth $1000 absent sentimental value then no one will offer to buy it from your for anything more than $1000, therefore you would only pay property taxes on $1000 of value.
  - lelanthran 5y ago
    > I don't understand the objection. If it's only worth $1000 absent sentimental value then no one will offer to buy it from your for anything more than $1000. No, but you could be forced to sell at exactly $1000. And, of course, some people are just mean. A person who wanted to punish their ex could, by force, buy a beloved item for more than what it is valued for, simply as retaliation against their ex. Your wedding gifts are typically as close to worthless as possible as far as money goes, and yet someone with a grudge against you could simply take it off you for a small cost to themselves. So, no, confiscating things from people with "fair reparations" to give them to other people is simply a no-go. If you cannot understand the objection at this point, then you never will.
    - tome 5y ago
      > No, but you could be forced to sell at exactly $1000. No you couldn't. You can't be forced to sell at all unless you are unwilling to pay land value tax on the offered value. Anyway, I'm proposing a simple game theoretic construct that can address the problem of under- and overvaluation of property with regard to property taxes. I am not a president about to sign a bill into legislation. I acknowledge that this idea requires refinement before it would work in practice. I just thought people would find it interesting.
      - lelanthran 5y ago
        > No you couldn't. You can't be forced to sell at all unless you are unwilling to pay land value tax on the offered value. So, under your proposal, you would have to value your property at the sentimental value it has for you, which for some things is infinite. My theoretical dad's VW would have to be "valued" at $1500, and if I think someone with a grudge against me is willing to pay that, I'd have to progressively increase the tax I pay on it just to keep it? This is a very bad idea; in fact, I cannot think of a single state that ever experimented with such an idea. If no state, even failed states, thinks it's a good idea I don't see what refinement you could make that turns it from a bad idea into a good idea.
        tome 5y ago
        This is a game theoretical idea that shows how to address under- and overvaluation of property. How to refine it into a practical system is an open question but I'm sorry, I just don't see how your example of inheritance of a Beetle scuppers the whole thing. Property taxation being used to unfairly seize objects of mere sentimental value seems an easy to problem resolve compared to the problem of imposing property taxation at all. The real reason land value tax hasn't seen much use in any jurisdiction is that it massively advantages the common person above the wealthy landowner, so there are huge structural pressures against it.
Cederfjard 5y ago
So rich people could just take whatever land they wanted, or am I misunderstanding you? If Big Ag wants my family farm, there’s nothing I can do but shut up and accept the money?
- tome 5y ago
  If Big Ag offers to buy your family farm for $10M then you have two options: 1. Sell it to them for $10M 2. Pay land value tax on it as though it were worth $10M What other meaning does "land value" have than what someone is willing to pay for it? (Roughly. There has to be some hysteresis and other frictional factors inserted to make it workable. My comment was not supposed to be interpreted as a finished piece of legislation, just a rough idea of how to prevent gaming.)
  - cgriswald 5y ago
    In your scenario, Big Ag just needs to offer an amount that causes the tax burden to be unbearable for the person who currently owns the farm. That’s not “the value of the land” but the cash flow of the owner at a moment in time.
    - tome 5y ago
      I presume it would be easy to set up systems of mortgages to pay land value tax. In fact I imagine that in practice land value taxation would be indistinguishable from paying a slightly higher mortgage, for most people. In fact given the downward pressure it would impose on property prices it could easily mean people end up paying less than what they would pay as mortgage under the current system.
      - nybble41 5y ago
        Say the tax is 10%. You already have a mortgage on the property, and not a lot of other assets. "Big Ag" offers 20 times what the property is worth to buy you out and eliminate a competitor. The tax (10% of 20x) would be double the standard market value. No bank is going to let you borrow double the ordinary market value in addition to what you already owe to cover the tax. You have no choice but to sell.
throwaway0a5e 5y ago
That works fine (and by "fine" I mean it can be implemented, not that it will produce the desired result) if you're managing authoritarian society where everyone is under the government's thumb but anywhere with a shred of democracy will vote out politicians who violate their property rights like that.
- tome 5y ago
  I can understand how land value taxation could be interpreted as violating property rights but I can't see how the method I outlined for establishing property values is any greater a violation of property rights. In both cases if you keep your property if and only if you pay your land value tax! Of course, this method needs some work to be palatable, but that's negligible compare to making land value tax itself palatable.
- eutropia 5y ago
  Some people don’t view anyone as having a “right” to something they had no hand in creating. Earth existed, then humans existed: why does any one human have a claim to this finite resource of planetary surface area? LVT says no human has intrinsic ownership of land, that it is “held in common”, and so no one ought to be able to monopolize the gains of its unimproved benefit. Make as much money as you want by your productive use of the land, or pay the market value if you don’t: but don’t horde it to yourself without paying your share.

by tome 5y ago

lelanthran 5y ago

> There are clever ways of addressing gaming, for example, to counter undervaluation there could be a rule that says that if you value your land at $X then anyone is legally allowed to force you to sell it to them for $X. That doesn't work. Just because I inherited my fathers beloved VW Beetle[1] that's only worth $1000 doesn't mean that I want to part with my father's beloved VW Beetle; it means much more to me than the official valuation. Same goes for any other property - boats, land, etc. [1] Example only, I did not

tome 5y ago
I don't understand the objection. If it's only worth $1000 absent sentimental value then no one will offer to buy it from your for anything more than $1000, therefore you would only pay property taxes on $1000 of value.
- lelanthran 5y ago
  > I don't understand the objection. If it's only worth $1000 absent sentimental value then no one will offer to buy it from your for anything more than $1000. No, but you could be forced to sell at exactly $1000. And, of course, some people are just mean. A person who wanted to punish their ex could, by force, buy a beloved item for more than what it is valued for, simply as retaliation against their ex. Your wedding gifts are typically as close to worthless as possible as far as money goes, and yet someone with a grudge against you could simply take it off you for a small cost to themselves. So, no, confiscating things from people with "fair reparations" to give them to other people is simply a no-go. If you cannot understand the objection at this point, then you never will.
  - tome 5y ago
    > No, but you could be forced to sell at exactly $1000. No you couldn't. You can't be forced to sell at all unless you are unwilling to pay land value tax on the offered value. Anyway, I'm proposing a simple game theoretic construct that can address the problem of under- and overvaluation of property with regard to property taxes. I am not a president about to sign a bill into legislation. I acknowledge that this idea requires refinement before it would work in practice. I just thought people would find it interesting.
    - lelanthran 5y ago
      > No you couldn't. You can't be forced to sell at all unless you are unwilling to pay land value tax on the offered value. So, under your proposal, you would have to value your property at the sentimental value it has for you, which for some things is infinite. My theoretical dad's VW would have to be "valued" at $1500, and if I think someone with a grudge against me is willing to pay that, I'd have to progressively increase the tax I pay on it just to keep it? This is a very bad idea; in fact, I cannot think of a single state that ever experimented with such an idea. If no state, even failed states, thinks it's a good idea I don't see what refinement you could make that turns it from a bad idea into a good idea.
      - tome 5y ago
        This is a game theoretical idea that shows how to address under- and overvaluation of property. How to refine it into a practical system is an open question but I'm sorry, I just don't see how your example of inheritance of a Beetle scuppers the whole thing. Property taxation being used to unfairly seize objects of mere sentimental value seems an easy to problem resolve compared to the problem of imposing property taxation at all. The real reason land value tax hasn't seen much use in any jurisdiction is that it massively advantages the common person above the wealthy landowner, so there are huge structural pressures against it.

Cederfjard 5y ago

So rich people could just take whatever land they wanted, or am I misunderstanding you? If Big Ag wants my family farm, there’s nothing I can do but shut up and accept the money?

tome 5y ago
If Big Ag offers to buy your family farm for $10M then you have two options: 1. Sell it to them for $10M 2. Pay land value tax on it as though it were worth $10M What other meaning does "land value" have than what someone is willing to pay for it? (Roughly. There has to be some hysteresis and other frictional factors inserted to make it workable. My comment was not supposed to be interpreted as a finished piece of legislation, just a rough idea of how to prevent gaming.)
- cgriswald 5y ago
  In your scenario, Big Ag just needs to offer an amount that causes the tax burden to be unbearable for the person who currently owns the farm. That’s not “the value of the land” but the cash flow of the owner at a moment in time.
  - tome 5y ago
    I presume it would be easy to set up systems of mortgages to pay land value tax. In fact I imagine that in practice land value taxation would be indistinguishable from paying a slightly higher mortgage, for most people. In fact given the downward pressure it would impose on property prices it could easily mean people end up paying less than what they would pay as mortgage under the current system.
    - nybble41 5y ago
      Say the tax is 10%. You already have a mortgage on the property, and not a lot of other assets. "Big Ag" offers 20 times what the property is worth to buy you out and eliminate a competitor. The tax (10% of 20x) would be double the standard market value. No bank is going to let you borrow double the ordinary market value in addition to what you already owe to cover the tax. You have no choice but to sell.

throwaway0a5e 5y ago

That works fine (and by "fine" I mean it can be implemented, not that it will produce the desired result) if you're managing authoritarian society where everyone is under the government's thumb but anywhere with a shred of democracy will vote out politicians who violate their property rights like that.

tome 5y ago
I can understand how land value taxation could be interpreted as violating property rights but I can't see how the method I outlined for establishing property values is any greater a violation of property rights. In both cases if you keep your property if and only if you pay your land value tax! Of course, this method needs some work to be palatable, but that's negligible compare to making land value tax itself palatable.
eutropia 5y ago
Some people don’t view anyone as having a “right” to something they had no hand in creating. Earth existed, then humans existed: why does any one human have a claim to this finite resource of planetary surface area? LVT says no human has intrinsic ownership of land, that it is “held in common”, and so no one ought to be able to monopolize the gains of its unimproved benefit. Make as much money as you want by your productive use of the land, or pay the market value if you don’t: but don’t horde it to yourself without paying your share.